California State health premiums to rise an average 12.5 percent in 2018!

The roughly 1.4 million Californians who buy health insurance through the state Covered California exchange will see their premiums increase by an average of 12.5 percent next year.

Covered California, created under the Affordable Care Act and in its fourth year of operation, announced the proposed 2018 prices on Tuesday. Bay Area counties will see smaller increases than the 12.5 percent statewide rise. Rate increases will average 6.6 percent in San Francisco, 4.3 percent in San Mateo County, 8.2 percent in Contra Costa County, 10.4 percent in Santa Clara County and 8.3 percent in Alameda County. Marin, Solano, Sonoma and Napa counties are all part of the same pricing region, which will see an average increase of 7.4 percent overall.

Counties in the northern and central state would see far greater average increases of 33.2 percent and 24 percent, respectively. Experts said Bay Area rate increases are smaller in part because Kaiser, which dominates the region, generally had lower rate increases than other insurers.

For some consumers, the premium increases will be offset by larger federal subsidies, Covered California officials said.

California’s average premium increase is less drastic than those proposed for some other states’ insurance exchanges, including a 24 percent jump in New Jersey and a 38 percent spike in Idaho, but it is higher than Arizona’s proposed 7.2 percent increase, according to figures tracked by the popular health industry blog ACAsignups.net.

“Covered California and the many carriers we work with are in it for the long haul to make sure Californians have affordable care and coverage they deserve and can depend on,” said Peter Lee, executive director of Covered California.

Overall costs for medical services are rising 6 to 7 percent a year, Lee said. The 12.5 percent average premium hike is higher than that partly because it builds in two other factors. One is a 2.8 percent increase passed on to consumers because insurers must start paying an ACA tax in 2018 that they had previously been able to defer. The other is a 3 percent increase that was incorporated because of uncertainty over ACA implementation at the federal level. The Trump administration has signaled that it will not fully enforce elements of the ACA — like the mandate that everyone buy coverage. The mandate spreads the cost of health care among a bigger pool of people, and state officials say not enforcing it could increase costs for those who get coverage.

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